Cocoa farmers are demanding a farm-gate price of GH¢1,380 for a 62.5kg bag of cocoa beans, a 72.5 percent increase over the current price of GH¢800.
As COCOBOD gets ready to announce new prices for the upcoming 2023/2024 cocoa season in the coming days, a group known as the Ghana Civil Society Cocoa Platform (GCCP) at a press conference in
Read full articleAccra argued that the 72.5 increase will help stop the problem of cocoa smuggling along the country’s western and eastern borders, and cushion farmers against rising cost of living and inflation.
“We realised that just as the international cocoa market price started appreciating, our neighbours that use the liberalised cocoa marketing approach increased their farm-gate prices. At some point this year, a bag of cocoa was selling in Togo at GH¢1,500 (twice what Ghanaians were being paid), which fuelled the nefarious activity of cocoa smuggling – as some farmers were offered over 30-40 percent beyond the prevailing market price in Ghana to sell their cocoa to these smugglers,” said GCCP, which represents cocoa farmers’ interest.
Leticia Yankey, a cocoa farmer and founder of Cocoa Mmaa, addressed the press conference and called on COCOBOD – regulator of the cocoa industry – to as a matter of urgency yield to the group’s demands.
According to her, based on the working assumptions of the Producer Price Review Committee (PPRC), GCCP firmly believes that Ghanaian farmers should receive a minimum of GH¢22,080 per tonne. This is equivalent to GH¢1,380 per bag (62.5kg) of cocoa beans. The PPRC aims to ensure that the farm-gate price is at least 70 percent of the net free on board (FoB) price of cocoa beans.
Ms. Yankey explained that the figure was calculated using the lowest projected values, including the agreed-upon living income differential (LID) of US$400 per tonne and the current International Cocoa Organisation (ICCO) world cocoa market price – which is US$3,647 per tonne of cocoa beans. The calculation also took into account the significant decrease in the origin differential/country premium, which has dropped from over US$400 to the current US$25.
“Assuming COCOBOD gives all the US$400 LID to the farmer that brings the farm-gate price to US$2,162 per tonne (US$135 per bag) for the 2023/2024 cocoa season – and using the year-on-year Bank of Ghana (BoG) exchange rate of US$1:GH¢10.2 – cocoa farmers are expected to receive not less than GH¢22,080 per tonne of cocoa beans; which should translate into a minimum of GH¢1,380 per bag of cocoa beans,” she stated.
“These are very conservative estimates, and we expect COCOBOD will be able to meet them with ease,” she added.
COCOBOD’s announcement
Last year, government did not announce a new cocoa farm-gate price for the 2022/2023 crop season, which started on October 1, 2022.
The last time government raised the cocoa farm-gate price was in 2020, increasing it by 21 percent from GH¢660 to GH¢800 per bag.
This increase was linked to implementation of the living income differential, a pricing mechanism aimed at eradicating poverty among farmers.
Cocoa farmers’ expectations for the Saturday 9, 2023 announcement by COCOBOD are therefore at ‘fever-pitch’, due to developments on the international cocoa market, Ms. Yankey said.
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Cocoa prices expected to rise
